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Calderon Government Sends in Police to Take Over Electrical Company and Bust Union

Posted by americasprogram on October 12, 2009

Sunday’s march in Mexico City drew of thousands of demonstrators

Laura Carlsen

Last Saturday, before scheduled Monday talks between the Central Light and Energy Company (LFC) and the government, federal police were ordered to take over more than 50 electrical installations just before midnight. The police assaulted the premises by jumping fences and using metal-cutters to break chains and locks. Just moments after the security forces occupied the premises, President Felipe Calderon issued an executive decree to liquidate the company. The move seeks to open the state-owned utility up for privatization and eliminate one of the nation’s most active independent unions.

The decree follows a union conflict that the government fueled and then took advantage of to eliminate the company and its union. The union elections last June were contested by the losing group amid rumors that the federal government was actively fomenting division. In a warning sign, on Oct. 5 the Secretary of Labor, Javier Lozano, rejected registration of the new union leadership without waiting for a decision from the Labor Tribunal.

What’s been dubbed the “Sabadazo” or Saturday Offensive took place when the union and the government were in the middle of talks and awaiting a promised response from the Calderon administration. Once again, the Mexican government showed a propensity for unilateral blows and the use of force over dialogue. Although it had previously taken aggressive stands against unions, this is by far the biggest union-busting measure yet and has sparked widespread indignation among workers and the public.

In the middle of an economic crisis that has stripped a million people from jobs in the formal sector, some 44,000 families of electrical workers have been left without a breadwinner from one day to the next. The government has said it will pay more than $1.6 billion dollars in severance pay and benefits to the workers and over 22,000 retirees of the company. The union says members will not accept the buy-off package.

The reasons for liquidating the Central Light and Energy Company (LFC), a decentralized company of the federal Energy Commission, were 1) excessive losses, 2) energy loss due to technical causes and lack of payment for services, and 3) excessive costs for public works. Union leaders state that much of this is due to the government’s own mishandling in the administration of the entity and the lack of public investment in the company. The company receives massive state subsidies for its operations. President Felipe Calderon and the ministers of Energy, Government, Treasury, Social Development, Economy, Communications, Labor, Public Works, Environment and Agriculture signed the decree.

The Mexican Electrical Workers Union (SME, by its Spanish initials) is among the most active and independent unions in a country that has been dominated by government-affiliated unions. Its membership has led the many battles for defense of labor rights and standard of living in the country. SME leader, Martin Esparza, declared the Calderon takeover “unconstitutional” and has vowed to fight against the liquidation of the company and of the union contract. In a joint interview on MSVRadio, he spoke alongside the defeated union candidate, Alejandro Munoz, in which both declared common cause to fight against the administration’s union-busting move.

The union made it clear to the public that any interruption in services would be the fault of removing trained union electricians. The country has reported some power outages although so far service remains overall. Government spokespersons have attempted to blame the union for any interruption of services, stating that it expected acts of “sabotage.” The union adamantly denied having any intention of interrupting services.

There have been constant demonstrations since the middle-of-the-night takeover Saturday. Sunday’s march drew of thousands of demonstrators, chanting slogans against the Calderon administration and in defense of workers’ rights. One worker told this observer that even though they expected a long battle, the workers would not give up and had already received support from other Mexican unions and the public.

A flyer handed out at Sunday’s demonstration, which blocked major streets in the downtown area, notes “The federal government, through Javier Lozano Alarcon head of the Ministry of Labor, has decided to declare war on Mexican workers and especially on the Mexican Electrical Workers Union faced with its absolute failure to comply with the campaign promises of Felipe Calderon Hinojosa.”

It states that Calderon came to office promising employment and that so far in his term 1,200,000 jobs have been lost and real wages have plummeted. “What is at the bottom [of these acts] is the attempt to liquidate LFC, to privatize the electrical industry.” The government has long wanted to privatize the state-owned company as part of the third generation of structural reforms dictated by the World Bank and since the fiber optics networks are coveted by powerful economic groups in the private sector allied with the administration.

The union planned to present evidence of contract violations at the Monday meeting and enter a grievance in the courts, which according to Mexican legislation is the step prior to declaring a strike. The administration’s take over of the installations and plan to liquidate the entire company was a pre-emptive move to deny workers a right to defend their labor rights through strike if necessary. Six thousand police and security agents were sent to control the installations. There have been reports of minor skirmishes.

Luis Hernandez Navarro of La Jornada writes that the SME is the oldest union in the nation, founded in 1914. Internally, the union has a structure that combines frequent assemblies and elections with referendums and maintains real participation of the rank-and-file. Hernandez concludes, “The police and military assault on the electrical workers is a serious step backwards in the democratic life of the country. It provokes a major short circuit. It establishes a terrible precedent. It attempts to resolve a conflict created by the government itself through violence and takes us back to the darkest stages of authoritarianism. Three years into his administration, Felipe Calderon’s weakness is severe. His latest move against labor will deepen it even more.”

The decree to liquidate the LFC effectively liquidates one of the country’s most active and democratic unions at a time when the defense of workers’ rights is crucial.

The government has said it is not privatizing the state-owned enterprise but Esparza revealed that two former Secretaries of Energy, Fernando Canales Clariond and Ernesto Martens, have formed a private company to use the publicly funded LFC fiber optic network for Internet and voice services called WL Communications. Esparza reports that the businessmen have already negotiated government discounts and subsidies for the lucrative enterprise. The pattern is familiar—the majority of Mexico’s billionaires made their initial fortunes off state privatizations under scandalous terms during the Salinas administration.

The union is appealing to the Congress and the courts to declare the takeover of LFC unconstitutional. Major demonstrations will be held all week. Labor organizations around the world have issued declarations of protest against the Calderon antiunion action and in support of the SME.

Note to readers: The Americas Program will continue to cover this major event in Mexican history. We do not anticipate an interruption of services but when an entire trained workforce is replaced overnight, problems can occur. We receive our power from LFC. If you don’t hear from us, it is because we have experienced a problem and will seek other means of communication.

Letters can be sent to:
President Felipe Calderon at felipe.calderon@presidencia.gob.mx
Mexican Electrical Workers Union (SME) sinmexel@sme.org.mx